Fixed assets

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

05 March 2014 what is the effect if VAT amount is included in asset value..is it mandatory to include VAT amount in asset value?
why do we include VAT amount in asset value?

CA Siddhartha Bhardwaj

CA Siddhartha Bhardwaj (Expert)
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05 March 2014 VAT paid on fixed assets can either be claimed as Input VAT credit or can be added to the cost of the asset.

Claiming Input VAT credit is more beneficial since it is reduced directly from the tax liability on sale of goods.